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Government Subsidy’s Effect on the Channel Strategies of Energy-Saving Supply Chain

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Abstract

As subsidy is a popular form of stimulating consumption, not only for home appliances market, the effectiveness of selling promotion subsidies need to be analyzed. In this paper, we check the role of promotion subsidies in the offline channel layout by establishing three models, i.e., no subsidy, customer rebate and retailer subsidy. Two kinds of online-to-offline strategies are considered, which are retailer’s opening separate and sharing offline stores. It is gotten that: both customer rebate and retailer subsidy increase the possibility of opening offline channels by sharing offline store strategy, but customer rebate takes high price than no subsidy while retailer subsidy is on the contrary. With the growing subsidy, both customer rebate and retailer subsidy could make offline channels opened by separate or sharing offline store strategy, but the customer rebate brings more possibilities. Both customer rebate and retailer subsidy require less social welfare to open offline channel, but the customer rebate brings more consumer surplus of opening offline channels than retailer subsidy for a given market area. Therefore, government should give the subsidy to customer, not to retailer, even if it brings the increasing of product’ price.

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Acknowledgments

Thank you to all anonymous Reviewers and editors for their help to improve the quality of the paper. This research was funded by National Science Foundation of China (No. 72171024, 71801016), in part by the project of cultivation for young top-motch Talents of Beijing Municipal Institutions (No. BPHR202203154) and R&D Program of Beijing Municipal Education Commission (SZ202310037015).

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Authors and Affiliations

  1. State Grid Jibei Electric Power Co., Ltd, Tangshan, 063000, China

    Zijian Bi

  2. Institute for Carbon Peak and Neutrality & Logistics School, Beijing, 101149, China

    Xiaohui Yu & Zihan Su

  3. School of Management & Economics, Beijing Institute of Technology, Beijing, 100081, China

    Qiang Zhang

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  1. Zijian Bi
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  2. Xiaohui Yu
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  3. Qiang Zhang
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This article has been composed by Zijian Bi, Xiaohui Yu, Qiang Zhang, and Zihan Su. All four authors have read and agreed to the published version of the manuscript.

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Correspondence to Xiaohui Yu.

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Zijian Bi, Xiaohui Yu, Qiang Zhang, and Zihan Su declare no conflict of interest.

Additional information

Zijian Bi has obtained a master’s degree in power system and automation from North China Electric Power University. He is now the secretary and deputy manager of the power supply company in Caofeidian District, Tangshan City, the State Grid Corporation of China, and has been rated as the exemplary individual of the innovation and application demonstration of the modern smart supply chain of the State Grid Corporation of China.

Xiaohui Yu has obtained a doctoral degree in management from Beijing Institute of Technology. The research field is game theory and its application in supply chain. She has contributed over 50 articles to professional Journals such as Fuzzy Sets and Systems, Computational and Applied Mathematics, Applied Mathematics and Computation, Journal of Intelligent & Fuzzy Systems, Soft Computing, Journal of Beiing Institute of Technology, Journal of Cleaner Production, Systems Engineering - Theory & Practice, Journal of Systems Engineering and Electronics, Operational Research, International Journal of Uncertainty, Fuzziness and Knowledge-Based Systems, etc. She is awarded the first batch of Outstanding Youth Talent Projects in Beiing Municipal Universities. She has presided over two National Natural Science Foundations of China, a Humanities and Social Sciences Foundation of the Ministry of Education, a general project of Social Science Plan of Beiing Education Commission, a key project of Social Science Plan of Beiing Education Commission, three science and technology projects of Beiing Wuzi University, and several research projects related to supply chain funded by enterprises.

Qiang Zhang formerly served as the Director, Professor, Doctoral Supervisor of the Department of Management Science and Engineering at the School of Management and Economics at Beijing Institute of Technology, Executive Director and Secretary General of the Beijing Institute of Operations Research, Director of the China Institute of Operations Research, and Executive Director of the Decision Science Branch of the China Institute of Operations Research. The research field is cooperative game theory. He has published over 200 papers in academic journals and conferences both domestically and internationally, of which 10 paper are included in SCI and 30 were included in EI. He has hosted and participated in 10 scientific research projects, including 4 National Natural Science Foundation projects and 2 scientific research projects that have won provincial awards.

Zihan Su is a graduate student at Beijing Wuzi University and the research field is game theory and its application in supply chain under the guidance of Professor Yu Xiaohui. She has published an article in the Mathematics in Practice and Theory and has participated in multiple projects of her supervisor.

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Bi, Z., Yu, X., Zhang, Q. et al. Government Subsidy’s Effect on the Channel Strategies of Energy-Saving Supply Chain. J. Syst. Sci. Syst. Eng. 32, 729–770 (2023). https://doi.org/10.1007/s11518-023-5581-9

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